Why business ethics so important in corporate world and why one should follow it?

Ethics concerns moral judgments about what is wrong and what is right. All the decisions made in a company are made by a few individuals or groups but they are influenced by the prevailing culture of the company. Business ethics are not a compulsion but it is a choice that gives a significant rank to the company. The decision to follow business ethics is a moral decision. Business ethics bears the full weight of any decision made in the corporate world.

What are the benefits of business ethics in corporate world?

Business ethics can bring several benefits to a company. For example,

1) It attracts the customers to the products supplied by the firm and thus it increases the sales and profits. 2) It also attaches the employees with the company, it makes them stay with the company and thereby reduces labor turnover and increases productivity. 3) It attracts increased number of employees to the company, which in turn reduces the cost of recruitment of new employees. It enables the company to easily hire more talented employees without hunting them done. 4) It attracts investors to the business and helps to maintain the share price of the company high. It protects the company from takeover. These are some benefits of business ethics and corporate social responsibility. Unethical behavior of a company can reverse the process of growth. Ignorance about corporate social responsibility can damage the reputation of a firm and can make it less appealing to the investors and the stakeholders. These may lead to serious fall in profit.

Businesses are expected to make as much profit as it can. A business itself contributes in the growth and development of society. But business leaders cannot quit their real objective and start doing social work; it will adversely affect the growth process. By applying ethics in their business, business leaders can fulfill both their responsibilities equally. A company can perform its moral duties along with making money and products good for the society by applying business ethics. An ethical business not only follows ethic itself but it also makes others do the same. The employees, suppliers, investors and the customers are more likely to follow the ethics when they feel the ethical surrounding. Ethical behavior replicates itself. If a person adopts it, it will be followed by other peoples as well and after some time the whole environment will become ethical.

Lack of ethics in business not only causes loss of reputation for that firm but it can cause serious loss to the wider world too. If a company is careless about dumping its waste products, it may hinder the development process of the country, loss of renewable resources and affects the lives of its inhabitants.

Ethical business is not only about being careful about the environment and making sure that you not cause any damage to the outer world. It also means that the company should dedicate some of its time in improving things around it like politics, entertainment, social work, and infrastructure of the country and so on. Business ethics not only helps your business but it takes the responsibility of the whole surrounding.

Business ethics are important for a business. It is the mirror of the composition of any company. It reflects the thinking and awareness of a company of its moral duties towards the society. It helps in maintain the reputation of the company and gets more investors, customers and employees to the company.

Kurt penberg is a well known American businessman who introduced a small, but very innovative company, “Sing Your Name,” a small company based in San Diego. For more information visit: Kurt penberg Blog

Ethics

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